Toronto stocks pulled lower by weak resources

Tue Jul 22, 2008 5:06pm EDT
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TORONTO (Reuters) - The Toronto Stock Exchange's main index finished lower on Tuesday, but trimmed earlier steep losses as a rise by financials offset a drop by resource issues that were hit by tumbling commodity prices.

The resource sectors led the downside and helped take the index down more than 1 percent in the morning, with energy shares hit by a six-week low for oil prices as fears over a tropical storm in the Gulf of Mexico eased.

The energy group fell 2.5 percent, with Canadian Natural Resources (CNQ.TO: Quote) down 4.2 percent and EnCana Corp (ECA.TO: Quote) off 3.6 percent.

A decline in gold miners helped knock the materials sector down 2.2 percent, as the price of bullion was sharply lower due to weaker oil prices and a stronger U.S. dollar.

But the financial sector offered support, despite falling earlier after U.S. bank Wachovia WB.N posted a record quarterly loss, as investors looked instead to recent better-than-expected results from other U.S. financials.

The S&P/TSX composite index .GSPTSE closed down 46.00 points, or 0.34 percent, at 13,643.19 with half of its 10 main sectors lower.

In the oil patch, Canadian Natural Resources (CNQ.TO: Quote) was down C$3.74 at C$85.69 and EnCana slid C$2.86 to C$77.17 amid a further retreat by oil prices. Crude futures fell more than $3 to $127.95 a barrel amid expectations of weakening U.S. demand, while Tropical Storm Dolly was forecast to spare most offshore oil production in the U.S. Gulf.

Among gold producers, Agnico-Eagle Mines (AEM.TO: Quote) was off C$3.18, or 4.4 percent, at C$68.65.

Fertilizer company Potash Corp of Saskatchewan (POT.TO: Quote) was the biggest decliner by weight, shedding C$5.39, or 2.4 percent, to C$217.60. Workers at three mines owned by Potash voted to give their union a mandate to strike if no progress is made toward a new contract.   Continued...